In 2023, consumer expenditure on mobile applications surged to a record-breaking $171 billion, marking a noteworthy three percent year-on-year growth, rebounding from a 2 percent decline observed in 2022.
The mobile app economy has now evolved into a colossal half-a-trillion-dollar market, witnessing an impressive daily spending of nearly $1.5 billion in 2023 across app stores and mobile advertising. This comprehensive figure incorporates a substantial $362 billion in mobile ad spending, showcasing an 8 percent year-on-year increase, as highlighted in data.ai's comprehensive 'State of Mobile 2024' report.
Beyond revenue, other key metrics also achieved remarkable milestones in 2023, with downloads and user engagement reaching unprecedented levels. The total time spent on mobile apps peaked at an astonishing 5.1 trillion hours, demonstrating an impressive growth of over 6 percent. Concurrently, downloads maintained a steady course at 257 billion, reflecting an approximate 1 percent growth.
The noteworthy surge in app store spending is particularly remarkable, given the unprecedented decline witnessed in 2022, primarily attributed to the mobile gaming sector, as outlined in the report.
In the competitive landscape, apps took the lead over games, contributing to an 11 percent year-on-year surge in consumer spending, reaching a substantial $64 billion. This figure is more than six times the total recorded in 2016. TikTok played a pivotal role in this surge, leveraging its content creator "tipping" mechanism to surpass an impressive $10 billion in lifetime spending.
The year 2023 also witnessed explosive growth in Generative AI, expanding sevenfold, leading to the emergence of innovative sectors like AI Chatbots and Art Generators. This AI proliferation fueled the integration of embedded features across diverse mobile sectors, setting the stage for a fresh wave of digital innovation. Notable Generative AI applications, including ChatGPT, Ask AI, and Character AI, gained prominence.
Generative AI apps achieved another milestone by surpassing $10 million in monthly consumer spending by late 2023. The report predicts that mobile ad spending will continue its upward trajectory, projected to reach $362 billion, with an 8 percent increase, primarily driven by short-form video and video-sharing apps.
The social and entertainment app categories experienced robust double-digit growth, with a 12 percent increase in time spent, totaling 3 trillion hours, and a 10 percent surge in spending, reaching $29 billion.
(With Agency Inputs)
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